nep-ecm New Economics Papers
on Econometrics
Issue of 2011‒12‒05
two papers chosen by
Sune Karlsson
Orebro University

  1. A Full InformationMaximum Likelihood Approach to Estimating the Sample Selection Model with Endogenous Covariates By Schwiebert, Jörg
  2. Ecological Inference with Entropy Econometrics: using the Mexican Census as a benchmark By Esteban Fernandez-Vazquez; Rafael Garduño

  1. By: Schwiebert, Jörg
    Abstract: In this paper we establish a full information maximum likelihood approach to estimating the sample selection model with endogenous covariates. We also provide a test for exogeneity which indicates whether endogeneity is in fact a matter or not. In contrast to other methods proposed in the literature which deal with sample selection and endogeneity, our approach is computationally simple and provides exact asymptotic standard errors derived from common maximum likelihood theory. A Monte Carlo study and an empirical example are presented which indicate that not accounting for endogeneity in sample selection models may lead to severely biased parameter estimates.
    Keywords: Sample Selection Model; Endogeneity; Maximum Likelihood Estimation; Female Labor Supply
    JEL: C31 C34
    Date: 2011–11
  2. By: Esteban Fernandez-Vazquez; Rafael Garduño
    Abstract: Most regional empirical analyses are limited by the lack of data. Researchers have to use information that is structured in administrative or political regions which are not always economically meaningful. The non-availability of geographically disaggregated information prevents to obtain empirical evidence in order to answer some relevant questions in the field of urban and regional economics. The objective of this paper is to suggest an estimation procedure, based on entropy econometrics, which allows for inferring disaggregated information on local income from more aggregated data. In addition to a description of the main characteristics of the proposed technique, the paper illustrates how the procedure works taking as an empirical application the estimation of income for different classes of Mexican municipalities. It would be desirable to apply the suggested technique to a study case where some observable data are available and confront the estimates with the actual observations. For this purpose, we have taken the information contained in the Mexican census as a benchmark for our estimation technique. Assuming that the only available data are the income aggregates per type of municipality and State, we make an exercise of ecological inference and disaggregate these margins to recover individual (local) data.
    Date: 2011–09

This nep-ecm issue is ©2011 by Sune Karlsson. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.